Property rights for digital assets: the Bitmark revolution

27th July 2018

Bitmark is helping people to generate wealth out of the data they produce by recording property rights for digital assets, as Sean Moss-Pultz tells Health Europa.

Bitmark uses blockchain technology to record property rights for digital assets, in view of a world in which people can not only own their data but also buy, sell, license and trade it. Intended to help people take back control of the data – and thus value – they create online, Bitmark has the ambitious aim of realising a digital environment built on individual freedom and empowerment, where everyone has a chance at success.

To get there, the Taiwan-based start-up has established the bitmark property rights system, a framework by which digital property titles, or ‘bitmarks’, are assigned to digital assets and recorded in an open-source Bitmark blockchain. This creates a permanent and unique ownership history that allows data to be authenticated, bought and sold.

In 2017, Bitmark turned its attention to the healthcare space by partnering with UC Berkeley School of Public Health, USA, to allow students to safely and securely donate the health and fitness data from their phones, wearables and other devices to research studies in diabetes care and women’s health. The Bitmark technology automates the entire donation process by:

Connecting researchers and data donors;

Extracting personal data and converting it into digital property; and

Establishing a verifiable record of donations.

In this way, the donors know exactly how, where, why and by whom their data is being used, and the researchers can verify the provenance of the data and confirm the donor’s consent to it being used.

To find out more about the potential of this technology, Health Europa met with Bitmark CEO and co-founder Sean Moss-Pultz at the Blockchain in Healthcare Congress in London, UK, who here discusses the notion of property rights for digital assets, the importance of transparency when it comes to sharing data, and the future of the blockchain.

How did the idea of recording property rights for digital assets come about?

Back around the time I got married, I was obsessed with Bitcoin. I was flying back and forth between Los Angeles and Asia and one time there was this really rough turbulence; I thought for sure I was going to die, so when I landed I called my dad, an estate planning lawyer, and I asked him how I could put Bitcoin into my will – but not only Bitcoin, my e-books and music, as well, because I travel a lot and so most everything I have of value is digital. My dad asked me if these things were my property, and I couldn’t answer, because I didn’t know what property was. So, I went and studied the history of property.

The notion of property rights developed out of farmers wanting to have control over what they were growing. It was the individual being able to own their own land that created the agricultural revolution. This framework then expanded to include ideas and knowledge – copyright, patents, trademarks etc. – which sparked its own revolutions. So, then I started to think about data and digital assets. Who has the rights to those? Why is it that if I buy a physical book, I own it and I can lend it to someone or give it away, but if I buy an e-book I can’t?

This is where the idea behind Bitmark came from: could we use the legal framework of property rights for digital assets? And could we then use that to enable the individual to exert control and ownership over their data? We settled on health data because it’s the one piece of data that everybody believes is valuable but hasn’t already shared for free on Facebook or Google.

At the moment we’re encouraging people to donate their data as an intermediate step – our real goal is for people to be able to generate wealth from their data. But that’s still a
while away.

Why is that? Is it because the technology isn’t there, the regulation isn’t there?

Both of the above, but the biggest hold up is always behaviour. Imagine if I were to say to someone: ‘Your location data is worth £100 (~€113) a year; do you want to sell it?’ Right away there would be so many questions: Sell it to who? For what? Can I trust them? All of those things of course need to be resolved, but once the behaviour changes, I do believe that one day we’ll be able to generate tremendous amounts of wealth from our personal data. Maybe in ten years.

Do you expect that to move more quickly in different parts of the world?

Property rights are recorded in property systems. The West has incredibly robust, old, antiquated systems; the East has almost none. Just like the mobile phone took off in Asia first, we thought that if we worked originally in societies that don’t have very strong property systems, we’d have a better chance of success.

There’s a myth, especially in the USA, that China is just a copycat and in fact most of Asia is copying the USA; it’s very convenient to perpetuate that idea, but actually the opposite is true. Asia has been innovating hard for the past five years, and things are moving much faster over there.

Can you tell me a little about the work Bitmark is doing with UC Berkeley? How does the technology ensure that donors’ data is protected?

Our technology allows you to own your own data, authenticate other property people want to send you, and begin building this concept of a digital estate. The way this works at Berkeley is a donor can find a study, see what the requirements are and what kind of data is being collected, and then sign up.

When that consent has been given, once a day Bitmark technology will extract the data from the HealthKit app on the donor’s phone, encrypt it locally, sign it, and then register the right to that data on our blockchain. The donor can then transfer that right in one of two ways: they can either donate the data, i.e. give a copy of it to the researcher to do with as they wish, or they can grant the researcher access to read the data but not to write to it, not to own a copy of it. That access can be granted for five minutes, five hours, or five days – however long the donor wants. And the blockchain is now acting like a lawyer, determining who can access the data at what time, all of which is enforced in the protocol itself. Importantly, in either case, the data can be tracked so that the donor can verify that it’s gone to the researcher.

What happens to that data once the study is complete?

If a donor opts out of the study, the researcher can give their data back; otherwise, once the study ends, a copy of the donated data belongs to the researcher. The donor has given it to them to use for this study, so if the researcher then goes and uses it in a different study, that would violate the agreement between the researcher and the donor.

Of course, if you give someone a copy of your data, that’s theirs. All encrypting it does is protect the transport. Once they’ve got it, if their computer is hacked, or if they want to throw that data up on BitTorrent, you have no way of stopping that, technically.
What our system does is it marks that data, so, later on, if that data were to appear somewhere else, you could identify who or where it was leaked from. That, in effect, allows you to apply a rule of law to data donation and ownership.

The key thing to understand about Bitmark is that we’re not trying to violate any laws of (digital) physics, we’re just trying to take the existing system of property rights, which works extremely well, and apply it to digital assets, which desperately need transparency.

In what way can blockchain technology allay some of the privacy and security concerns people have about sharing their data?

To alleviate those concerns, we really need to work in areas where there is already a high degree of trust. I spoke with a large pharmaceutical company and they said that nine out of ten patients actually want to share their data – the only caveat is trust.

The thing is, if I buy a car from you, I can’t know for sure that the car is perfect – it could be a pile of junk. I just have to trust you. The same is true of data. If someone wants to do nefarious things with the data you give them, you can’t stop them, because they already have it. The key, then, is transparency.

There are all kinds of market and regulatory issues, but as long as people understand the limitations of blockchain – because all technology has limitations – and we’re honest about those limitations, over time those problems will be sorted out.

Where do you see blockchain technology going in the future?

I talk with a lot of different companies, mainly financial, and most agree that blockchain is interesting, but they don’t think it can scale. For me, that’s exactly what the telecoms companies said, that you’d never be able to run voice or video over the internet. Of course, now, when you make a long-distance phone call, that’s happening over the internet. In fact, the whole backbone of the telecoms industry is the internet. In ten years, I believe that the backbones of all of the big institutions – banks, hospitals and so on – will be public blockchains.

What are Bitmark’s priorities going forwards?

Our mission as a company is to record property rights for all sorts of assets. We’re especially focused on recording property rights for digital assets because we think those are the interesting ones that are going to be of tremendous value. Land is a $217 trillion (~€185tr) asset class, one of the biggest in the world. Data is massive, too. How big? It’s hard to say.

In addition to looking at data donation, which creates social value, we’re also doing a lot of cool stuff with music and video game publishing rights, which creates economic value. That’s the real advantage of property rights for digital assets: giving control to the individual produces both economic and social value.